Tangled Titles: How to Navigate a Complex Housing Issue

Across the U.S., homeownership is considered a cornerstone of building wealth and realizing the American Dream. In many families, passing along a deceased elder’s property to an adult child or children is a good way to transfer wealth between generations.

In some unfortunate cases, however, the heir or heirs can later find it hard to prove their ownership because, though they may be living in the home passed on to them, their name does not appear on the deed—creating a “tangled title.” Similarly, “heirs’ property” refers to land owned jointly by descendants of a deceased person whose estate did not clear probate.

“Tangled titles can stay hidden until someone needs to prove ownership of their home,” said Paige Carlson, Director, TD Bank’s Office of Charitable & Corporate Giving and the TD Charitable Foundation. “Typically, proof of ownership is required to, get a mortgage or equity loan for repairs or upgrades, take an exemption for real estate taxes, or even apply for disaster relief. Of course, it’s also needed to sell an inherited property.”

Often, tangled titles occur after a family member dies without a will or without properly transferring their property’s deed to the heir before they pass away. Although this may affect only a small percentage of U.S. real estate, one estimate put the total value of properties nationally with tangled titles at $41 billion.

After Hurricane Katrina in 2005, an estimated 20,000 homeowners were denied federal assistance because their home’s title was not in their name. In response to these types of situations, the Federal Emergency Management Agency (FEMA) passed a series of reforms in 2021 to make it easier for owners with a tangled title to access assistance after a disaster.

Low-income families are disproportionately likely to inherit properties without a clear title, partly because fewer homeowners among them have wills. A Gallup poll found that while 61% of Americans with a household income above $100,000 have a will, only 30% of those earning below $40,000 have one.

Diverse groups are more likely to face challenges related to clouded titles, according to Paige. In the southern U.S., heirs’ property is widespread in rural areas, especially for Black families. According to the United States Department of Agriculture, in 365 counties across 10 states with largely Black populations, an estimated 1.6 million acres of land is held as heirs’ property.

“Many people own land passed down informally over many generations that may have tangled title,” she said. “That’s in part because historical institutional discrimination left some Black landholders unable, or at times, without resources to publicly record their ownership with a deed.”

How to resolve a tangled title

Tangled title issues and heirs’ property situations can impair a younger generation’s ability to grow family wealth because they lack clear title to the properties left to them. Often, they may not be able to maintain their inherited properties without having the proof of ownership needed to obtain financing to fix them up. Cashing out by selling their properties can be difficult if not impossible without a clear title.

Unwinding tangled titles usually requires legal services, which can make the process costly and time-consuming. In Philadelphia, for example, where The Pew Charitable Trusts estimated more than 10,000 tangled titles exist, it put the total costs to remedy one at more than $9,000, without subsidized legal aid or other public assistance.

“People who find themselves in a tangled title situation should seek the advice of a qualified legal professional such as an attorney specializing in clearing titles,” said Donna Walton, Wealth Strategist for TD Wealth. Use caution in the event that a stranger offers "help", as they may actually want to take advantage of the situation.

Donna suggests homeowners in need of resolving a tangled title start by contacting their local nonprofit community legal aid organization.

Another suggestion is to contact the state bar association to see if they have information on lawyers who specialize in this area and if there are programs to help with costs for those who may not be able to afford an attorney.

“Some large law firms reserve a certain amount of associates’ time each year to provide legal assistance to the community, and some cities have funds available to help lower-income people pay a big part of the legal fees," she said. "In any case, you want to find reputable people to give you valid recommendations."

Homeowners who are unsure if they have clear title to their properties can visit the records department of their local governments and check if their legal names are on their specific property record. Many records are also accessible online, according to Donna.

“If you find another name on your property’s title, you can ask the records officials for more information about it,” she added. “If you're in a community where you know tangled titles happen, talk to community members, talk to church members, talk to local council members and gather everyone’s suggestions."

Prevention, of course, is always best. Everyone should consider having a will because it reflects your intention of how you'd like your property to be handled. Having a routine to review it yearly allows for updates if any major life changes occur. Examples include marriage, divorce, birth, death, moving to a new state, and major asset acquisitions or dispositions. Adult children can support this effort by checking in with their parents that their wills are up-to-date.

“I can’t emphasize enough how important it is for families to have what can be difficult conversations about updating wills and estate planning,” Donna said. “If they don’t, tangled titles and heirs’ property situations can easily result.”

Below are some organizations that provide assistance with tangled titles.

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